The following partial balance sheet is provided for Groom Company: What is the company's debt to assets ratio? (Rounded to nearest whole percent.)
A)49%
B)16%
C)33%
D)Cannot be determined with the information given.

Question

The following partial balance sheet is provided for Groom Company:  What is the company's debt to assets ratio? (Rounded to nearest whole percent.)
A)49% 
B)16% 
C)33% 
D)Cannot be determined with the information given.

Quizplus · Accepted Answer

Debt to assets ratio = Total liabilities / Total assets
We can find the total liabilities from the balance sheet, which is $200,000. 
We can also find the total assets from the balance sheet, which is $600,000. 
Therefore, Debt to assets ratio = $200,000 / $600,000 = 0.33 or 33% (rounded to the nearest whole percent).

The Following Partial Balance Sheet Is Provided for Groom Company